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Microsoft finally opening Seattle store opposite from Apple

updated 05:10 pm EDT, Wed July 27, 2011

by MacNN Staff

Store follows company's placement tactics

Microsoft is finally preparing to open its Seattle store, which has been placed directly opposite one of Apple's retail outlets. On the Microsoft Store official Facebook page, the company posted an image of the building, which is still under construction, along with a comment promising to open the University Village location sometime in the fall.

The store follows Microsoft's placement strategy, which appears to aim for close visual proximity to Apple Stores. The new location will replace the Miller-Pollard furniture shop, separated from the competition merely by a parking lot.

It is unclear if the new store, located near Microsoft's home turf, will generate more revenue than many of the company's other locations. Traffic and sales numbers have yet to be disclosed, though unofficial reports have pointed to lackluster performance.

That's a fairly large parking lot, so the two may be visible from one another, but they're not close. People who come for one, aren't likely to be drawn to the other. They're more likely to visit the B&N megastore.

This remark from Microsoft's blog isn't right: "From the top of the Space Needle, it looks like good things are on the horizon for Seattle. Particularly since the Microsoft Store is coming to University Village in the fall!"

You can't see either store from the Space Needle. In between is a large hill with the University of Washington, hence the "University Village."

The parking and traffic are terrible there. Both companies could have chosen a much better site further north and west. Locating together there is double folly.

I live near the Mall of America. There is an MS store that they opened up directly across the aisle from the Apple store. EVERY time i have walked by the Apple store is packed - I'm talking a hundred people or more at a shot. I have never seen more than 4-7 families/customers in the MS store ever, not including the employees. And most of those people are/were checking out Kinect and Xbox 360. Man would I be upset if I still held MS stock.........

There's a big difference between Apple and Microsoft; Apple stores sell Apple branded goods and were once the only outlet to see Apple goods. Now, iPods, iPhones, and iPads are available far and wide. Apple PCs are available from Best Buy. Still, Apple stores represent a significant amount of Apple's sales.

Meanwhile, Microsoft is selling, besides XBoxes, mainly other companies' products. Goods that are widely available and probably cheaper elsewhere. Even if Microsoft Stores were a big hit, they'd still probably be a drain on the Microsoft bottom line. In the end, while Apple stores help Apple, it is doubtful that Microsoft stores -- even if overly successful, would do much of anything for Microsoft.

And, they've set themselves up with a terrible comparison: store traffic. Apple stores are simply packed compared to the nearby Microsoft store. And, they would be too. You want to buy an Apple product, it might be the only place where you get to see one. Meanwhile, even XBoxes are available at Target, Walmart, Best Buy, Costco, and thousands of other retailers and chains. You don't need to go to a Microsoft store to play with an XBox.

Even worse, Microsoft is aping Apple's back-to-school offer. Apple is giving away a $200 iPod Touch with a purchase of a new Mac while Microsoft is giving away a $200 XBox with a purchase of a new PC (over $600). However, the computer that student would buy is an Apple computer, and at over $1200, Apple is still making money even after giving away an iPod Touch.

Microsoft, on the other hand, is giving away a $200 console (which may actually cost Microsoft $200 since game consoles are suppose to make their money on games). Yet, what the student is buying is a PC from another manufacturer. At best, Microsoft is making about $70 on the Windows license. Again, Microsoft is losing wads of money just to show Apple.

So, why does Microsoft do this? I take it that Balmer is still pissed over those "I'm a PC/I'm a Mac" commercials, and still thinks Microsoft's main competition is the Mac. Yet, Apple Computer has become Apple, Inc., and their main profit is not in their Mac line, but their iOS line. Meanwhile, Microsoft is practically out of the running for the Smartphone market, and has almost no presence in the tablet market.

Microsoft has some good technology. (XBox is pretty solid, Windows 7 Phone is neat, and Windows 7 is a pretty solid and fast operating system). However this constant struggle to "prove Windows" is killing the company. Why not allow Windows 7 Phone on tablets? Why are they getting rid of Windows 7 Phone completely with Windows 8?

Balmer has lead the company in the completely wrong direction for the past five years. It's time for him to go.

It only survived after years of RROD and return rates that would normally kill a products future for good because of MS automatic money generating lock on certain markets. They could afford to lose billions and billions and not blink once.

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